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Why Law Firms Should Consider Legal Administration Outsourcing?
Legal administration, a necessary clerical department in law firms, supports attorneys in maintaining the work schedule in balance with time management. While managing the day-to-day operations of law firms and legal departments, legal administrators basically handle non-attorney jobs such as budget assessment, payroll processing, arranging necessary office supplies, and supervising the entire clerical staff, mostly in an office setting. They are generally expected to have both secretarial and legal knowledge. In recent years, legal administration outsourcing has become increasingly popular as a way for law firms to save time and money. By outsourcing legal administration tasks to a third-party provider, law firms can free up their in-house staff to focus on more strategic and high-value work.
In the race toward becoming the legal firm of the future, law firms are also showing interest in outsourcing legal administrative services while striving for competitive advantage. Apart from the primary activities – scanning, copying, and emailing, there are opportunities to reduce some expenditures and enhance service quality by outsourcing other essential legal back-office functions such as administrative support, records management, word processing, etc.
To an extent, attorneys depend upon technology for their work; similarly, legal administration management duties require knowledge of multiple software used for different processes. The requirement for technical expertise and legal knowledge are other reasons why many law firms partially outsource their back-office.
Legal Process Outsourcing (LPO) Industry Stats:
1. According to Global Legal Process Outsourcing (LPO) Industry report by Report Linker, the global LPO market is expected to reach $15.7 billion by 2027 from $4.7 billion (estimated in 2020). Source
2. Williams Lea and Sandpiper Partners’s Seventh Annual Survey on Trends and Opportunities in Law Firm Outsourcing (UK and US), reports;
- 70% of respondents reported that their firms outsource (some/all) back-office activities, a 14% hike seen this year.
- “This upward trend is indicative of client pressures to reduce costs and rising firm expenses to meet the demands of outside counsel guidelines, data security, and data protection”.
- Firms are making considerable investments to fulfill client demands concerning digital document management – 61% and cybersecurity – 70%.
3. Top challenges survey respondents face while managing back-office and administrative functions; Source
- Workflow engineering and process management – 73%
- Partner resistance to change – 54%
- Management of security and confidentiality – 46%
Legal Administration Outsourcing: The Cost-effective Solution Law Firms Should Consider
Outsourcing is a way of investment that brings multiple benefits. Process management becomes easier by having a team of legal administrative experts working through promising and transparent service level agreements. The advantage of paying exclusively for the services received (without additional perks/health benefits) encourages savings.
Outsourcing some back-office jobs is an opportunity to enhance operational efficiency and reduce expenses. Besides, a reliable partner can help firms produce, implement, and manage strategic plans to minimize risks while keeping in compliance with norms.
Additionally, in the long run, firms can reduce costs of paperwork, records storage, etc. by getting complete support from the outsourcing partner in securely managing document processing digitally. With all this, firms are likely to save 30% of monthly overhead.
Some Other Reasons for Outsourcing:
- More time to focus on core functions
- Foster innovation
- Save costs and time on recruitment and training
- Access to expert legal administrators
- Round-the-clock operations
- Reliability – Specialization and on-time project delivery
- The in-house team focused on client-centric functions
- Scalability and flexible staffing options
- Improvement in work-life balance of lawyers
- Increase overall productivity and profitability
Legal Administrative Functions Lawyers/Law Firms can Outsource
1. Paralegal & Secretarial Jobs
There are a wide variety of tasks that a legal secretary performs as a part of their professional responsibility. Legal secretarial work usually includes document management, document conversion, preparation of graphs/charts/presentations, booking appointments, following-up on clients, and many other administrative tasks.
This makes hiring a paralegal or legal secretary necessary; however, it might not always easy to afford. For cost-saving purposes, firms across the globe prefer to outsource secretarial functions.
2. Virtual Legal Assistance
Hiring additional support for your law firm in the form of legal assistants can turn out to be consuming more time and expenses. Whereas, it would be more convenient to have service providers in your contact that can readily provide you with virtual legal assistance when you require. Furthermore, if you need more assistants, for example, for a big case, you can scale up accordingly. This will help release much of your attorneys’ workload, and they would spend more time preparing for client representation in court.
3. Invoices & Payroll Processing
Legal administrators also manage basic accounting and HR processes in most small to medium-size law firms. They check and process invoices, make payment records, calculate salaries, process paychecks, etc.; these time-consuming jobs steal a lot of their time and require them to be a multitasker.
Since invoice & payroll processing are not core legal responsibilities, law firms often outsource these to external firms that are experts at handling payments and payroll. With this, their in-house team gets more time to support attorneys with their daily chores.
4. Legal Writing
Legal administrators are generally required to write memorandums, work policy manuals, proposals, job descriptions – proofread, edit, draft interrogatories – draft emails, enclosures, and upload documents.
Considering the level of precision and security required while organizing, managing, storing, and sharing these documents, many law firms and lawyers outsource legal writing and relevant tasks. Experts at outsourcing firms have an eye for detail; they ensure all errors and mistakes are rectified.
5. Contract Management (Drafting, Abstraction/Extraction)
Contract management is one of the most common processes of any law firm. It involves contract drafting and abstraction – the process of extracting important dates, clauses, and other crucial information from documents. It also incorporates tagging all the essential terms in each contract.
Attorneys or legal administrators tend to spend more time on lengthy and complicated contractual documents. Outsourcing contract management enables law firms to save valuable time and resources, resulting in increased productivity and total compliance throughout the contract lifecycle.
6. Legal Data Entry
Attorneys use legal terminologies in documents that might be difficult to understand for those who are not familiar with legal proceedings; thus, not every data entry firm (despite having skilled and speedy data entry operators) can perform legal data entry.
Moreover, being highly confidential, data entry for legal documents should be done securely. Additionally, several lawyers find data entry as one of the most time-consuming jobs. With this in mind, outsourcing seems to be a viable solution. LPO companies have employed people capable of working on files in multiple formats and are well-versed in terms used in the legal sector.
Law firms increasingly recognize the benefits of project-based or complete outsourced solutions as a valid route to obtain optimum outcomes. The list of benefits goes beyond cost reduction. Outsourcing to a trusted partner can bring scalability and flexibility to law firms planning to enhance efficiency and profitability.
Legal administration Outsourcing or legal support services can make things easier and enable your attorneys to focus on strategic, more value-generating work. At Cogneesol, we can support your law firm or legal department with various legal processes or administration functions. As we have been working with different legal clients since 2008, we completely understand what you expect from us as your outsourcing partner and ensure that we can fulfill all your law office requirements.
Benefits of Outsourcing to Cogneesol
- Human Resources: With a growing talent pool, Cogneesol can be your reliable and experienced partner providing you resources in times of need.
- Accurate & Timely Delivery: We assure you that your back-office functions will be managed by our highly efficient, skilled, and trained team; and projects will be delivered within defined deadlines.
- Customer Service: Partnering with Cogneesol gives you a significant advantage – the advantage of having time. You get more time to focus on improving core business policies, workflow strategies, business growth, and expansion.
- Cost Saving: while we will be streamlining your processes, you will experience a considerable reduction in expenses that you can use for other business development projects.
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